TORONTO, May 4 (Reuters) - Toronto’s main stock index may edge higher at the open on Monday on rising confidence in a global economic recovery, but a slipping oil price may hamper gains.
The TSX, as it often does, could also feed off sentiment in the United States, where U.S. stock index futures were pointing to a higher open. [ID:nN04380579]
Overnight, Asian stocks punched to a seven-month high, fuelled by confidence the global economy is recovering faster than expected. [ID:MKTS/GLOB]
The S&P/TSX composite index .GSPTSE unofficially closed up 1.9 percent, or 172.13 points, at 9,496.96 on Friday. The TSX slipped 0.5 percent last week, following seven straight weeks of gains that have carried it up more than 25 percent since early March.
Here are some of the factors that may affect the market.
Oil CLc1 dipped below $53 a barrel, unravelling early gains, as nervousness that the strength implied by stock markets might be premature offset the impact of positive economic data on big fuel consumers China and India. [ID:nSP468176]
The precious metal firmed more than $5 on a weaker U.S. dollar and light Chinese buying, but rising stock markets could curb gains. [ID:nSP496807]
Hewlett-Packard Co (HPQ.N) and BlackBerry maker Research In Motion Ltd RIM.TO RIMM.O said they have formed an alliance to provide services for the BlackBerry. The services include support for BlackBerry’s Enterprise Server 5.0, which was launched on Monday. [ID:nBNG178360]
RBC Capital Markets upgraded the following Canadian banks:
* Bank of Montreal (BMO.TO) to outperform from underperform
* National Bank of Canada (NA.TO) to outperform from sector perform
* Toronto Dominion Bank (TD.TO) to sector perform from underperform
* Bank of Nova Scotia (BNS.TO) to sector perform fromn underperform
* CIBC (CM.TO) price target to C$95 from C$47
Following is a summary of research actions on Canadian companies reported by Reuters on Monday. For more, see [ID:CA/RCH]
* Raymond James cuts RioCan REIT (REI_u.TO) to market perform rating; price target to C$14 from C$15
* Desjardins cuts Cameco Corp (CCO.TO) to hold from buy due to stock appreciation; has C$28.40 target price
* RBC cuts, UBS raises price target on TransCanada Corp (TRP.TO)
Air Canada ACa.TO said discussions with unions have focused on seeking support from its unions for a moratorium on funding its pension deficit. The airline said itsn objective is to maintain current defined benefit plans without restructuring pension benefit formula. [ID:nWNAB2487]
Teck Resources TCKb.TO announced a proposed private placement of senior secured notes. It says the proceeds will be used to repay borrowings under its existing bridge credit facility. [ID:nWNAB2443]
BAY STREET-SELL IN MAY, GO AWAY? MAYBE NOT JUST YET
“Sell in May and go away” is an old adage that may not apply this year as the Toronto Stock Exchange looks to build on the seven-week rally that emerged from the wreckage of last year’s vicious downturn. [ID:nN30545369]
The transmission of the new H1N1 virus from a man to a herd of swine in Canada is a reason for concern and confirms the need for increased surveillance of pig farms, the United Nations food agency said on Sunday. However, the Food and Agriculture Organisation said the incident was not surprising and reiterated pork and pork products handled in accordance with good hygienic practices were safe to eat. Investors have largely brushed aside worries that the global H1N1 flu outbreak could turn into a serious pandemic. [nFLU]
$1=$1.19 Canadian Reporting by Ka Yan Ng